China’s research is taking a leap, UK can take advantage

Spreading its net wide: Chinese research centre in Antarctica. petehottelet

Two weeks after he was confirmed as the head of the Politburo Standing Committee last year, Xi Jinping led his new committee colleagues on a tightly-choreographed day trip to the National Museum in Tiananmen Square. Upon arrival, China’s incoming leaders viewed an exhibition called “Road to Rejuvenation”, which depicts China’s journey from the hardships and humiliations of the 19th century to a restored greatness in the 21st century. In his informal remarks that day to a group of reporters and museum workers, Xi spoke of the “Chinese dream”, an idea that he returned to five months later in his inauguration speech as president.

This phrase has quickly taken off, with government campaigns launched to promote it in schools and the civil service, a dedicated website affiliated to the People’s Daily and a TV talent show to find “The Voice of the Chinese Dream”. Academics are even being asked to come up with Chinese dream research proposals.

Science and innovation are important elements of this journey of national renaissance. This is reflected in China’s ambitions to become an “innovation oriented nation” by 2020 and a “world science and technology power” by around 2050: two of the goals set out in the government’s Medium to Long Term Plan for S&T and the blueprint for its current policies.

Yet a “dream” seems the opposite of a plan – certainly the kind of long range state-led planning that characterises China’s political system for many Western observers. Economist Mariana Mazzucato, a colleague at the University of Sussex, has written about the need for governments to build an “entrepreneurial state”, able to direct policy and investment towards priority technologies and shape emerging markets. Certain aspects of an “entrepreneurial state” are already visible in China (for example in its strategic investment in renewable energy technologies) but there is still some distance to go. For now, running through all of China’s national plans is a contradiction between a continued need to utilise foreign sources of technology, and a desire to nurture home-grown innovation.

There is no shortage of money flowing through the system. In 2012, China’s total expenditure on research and development (R&D) exceeded one trillion RMB (US$163 billion), an 18% increase on the previous year. Gross expenditure on R&D (GERD) as a share of China’s GDP rose from 0.5% in the mid-1990s to 1.97% in 2012, a marked absolute spending rise in an economy that grew by a factor of ten over the same period. The graph shows how this stacks up against leading spenders. Much of the growth has been driven by the business sector; the contribution of which increased from 60% of GERD in 2000 to over 75% in 2011.

OECD StatExtracts

China’s 12th Five Year Plan (FYP), launched in 2011, identified “seven strategic emerging industries” which are receiving preferential investment and policy support. The plan states that R&D and indigenous innovation must be a “core feature” of these new industries, which are intended to grow at 20% per year, to account for 8% of GDP in 2015, up from 3% of in 2005. These seven strategic industries are: energy conservation and environmental protection; next generation IT; biotechnology; high-end equipment manufacturing; new energy; new material; and low energy vehicles.

From a UK perspective it is interesting to compare and contrast this list with the “eight great technologies”, which have been identified by David Willetts, the UK’s minister for universities and science, as a priority for policy and investment. This is one of the issues that David Willetts has been exploring this week, during his visit to China alongside George Osborne and Boris Johnson. At the launch on Monday of Nesta’s report on “China’s Absorptive State”, Willetts observed, only half-joking, that “UK policy for innovation is gradually becoming more Chinese”.

At the same time, Chinese policymakers are keen to draw lessons from the UK’s research and innovation system. While the UK may not have the scale of the US, it remains a major power in research. As ministers are fond of reciting, with less than 1% of the world’s population, the UK produces 8% of the world’s publications, 14% of highly cited papers and 19.8% of papers with over 1000 citations.

China and the UK have much to gain from a deeper and more strategic set of connections across their innovation systems – from accessing new markets, to exploiting each other’s capabilities and facilities, to collectively shaping the future norms of the global innovation system. The Nesta report I worked on argues that the UK should develop a new five-year strategy for China-UK collaboration in research and innovation. Work towards this strategy should begin now, but 2016 would be the ideal time to publish it, in order to take account of new policies in China’s 13th FYP, and the 2015 post-election Spending Review in the UK. The strategy should encompass the full breadth of potential innovation links between the two systems, from research through to the commercialisation, demonstration and scaling phases of new technologies. For the UK, the choice is not whether to engage more deeply with the Chinese system, but how.